Marion Edmunds
Two former Western Cape housing officials are skimming hefty profits off the provincial low-cost housing programme in exchange for processing subsidy information for the state.
The Centre for Scientific and Industrial Research (CSIR) has appointed RR, a Cape- Town based consultancy run by two former senior departmental officials, to help manage electronic subsidy applications.
RR has been charging developers and consultants R62 to fast-track each subsidy, more than six times the amount it pays the CSIR for each application.
This leaves the consultancy with a R52 profit on each subsidy, a portion of which it has to spend on overheads, marketing and running costs.
The CSIR recently adjusted its fees after receiving complaints.
A departmental consultant, Latief Camroodien, has accused RR of ripping off the poor by demanding such a high fee for work he believes can be done very cheaply.
He says the administrative fee of R62 is not borne by the developer, but by the subsidy applicant, because the developer will always pass on the cost.
Camroodien says he has tried since 1996 to “expose” RR , but nobody was prepared to respond to his objections. He wants to cut out RR and deliver the subsidy information electronically to the housing board. The department can enter information manually for him, but it delays the subsidy approval by months.
Camroodien also claims that at least eight subsidies in a project in Weltevreden Valley on the Cape Flats have been awarded to people who do not qualify.
The department acknowledged this week that it was “rectifiying incorrect approvals of beneficiaries” but said RR was not to blame.